Surprising statistics that will make you rethink long-term care

Throughout the course of an entire lifetime, it is highly likely that we will experience at least one injury or serious chronic illness that requires long-term care, which means we will need hands-on assistance with everyday living. In fact, six in 10 U.S. adults are currently living with at least one chronic disease such as cancer, heart disease, diabetes, Alzheimer's disease or kidney disease.²

Such conditions will likely necessitate long-term care services at some point. In fact, seven in 10 adults will need some form of long-term care services in their lifetimes from a home health aide, adult daycare or full-service nursing home.¹

Compared to men, women spend twice as many years in a disabled state during their lifetime—up to three years if they live past the age of 80.² The reason for this may be twofold.

First, women tend to live about five years longer than men in the U.S.,3 which can easily translate to longer periods of time living with one or more chronic diseases that may require care. In fact, more than 70% of nursing home residents are female.³

As a result of their longer lifespans, women tend to be less likely to have a caregiving spouse close by to provide them with care. Therefore, they may be more inclined to obtain services from outside caregivers.

Some people will never require care at all or may only need it for a short time. However, 1 in 5 people will need care services for more than five years, which may incur significant costs. The monthly median cost for a nursing home is more than $8,600, or about $104,000 each year.⁴ After five years, the cost can easily exceed $500,000.

Many people choose to "age in place" using in-home care. While this is a common choice for those who are seeking more comfort and lower costs, it can still carry a financial burden. A home health aide has a median cost of $33 per hour,⁴ which equals more than $75,000 per year and more than $377,000 after five years. That figure compounds when you add costs of medical care, utility bills and day-to-day living expenses.

Home health aide costs4
$33 per hour (median) = $75,000+ each year = $377,000+ after 5 years

A common assumption is that retirement savings and Medicare coverage should be enough to cover living expenses and necessities down the road. However, Medicare coverage does not cover the cost of long-term residential care,⁵ and the unexpected twists and turns of life can introduce unforeseen costs that drain our retirement savings and render them insufficient to pay for the care we need.

Allstate Benefits offers group permanent life insurance with a variety of optional accelerated death benefit for long-term care riders. This coverage provides all the benefits of traditional life insurance. Also, if the insured person is certified as chronically ill and incurs long-term care expenses, as defined, it can provide access to acceleration of the death benefits. These funds can be used to help cover some of the costs of long-term care services.

Some qualifications are required, including certification by a licensed health care practitioner that the insured person needs assistance with two or more daily activities, such as dressing, bathing, eating, using the bathroom and moving around. Certain limitations may apply.

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A Simple Guide to Understanding Long-Term Care (and Paying for It)